Indonesia and Malaysia will begin a joint naval exercise on Wednesday as part of their efforts to prevent piracy and terrorism in the strategic Straits of Malacca, state media reported today.

"This is a routine activity and indirectly it is a way of anticipating terrorist movements in this area," First Admiral Mukhlas Sidik said in Batam, the Indonesian island bordering Singapore, according to the state news agency Antara .

He said the Straits of Malacca would "obtain a peaceful impact" from the biennial exercise involving four Malaysian warships and four from Indonesia.

The narrow 960-kilometre Malacca Straits, which runs along the coasts of Indonesia, Malaysia and Singapore, carries about half the world's oil supplies and a third of global trade.

Fears that terrorists could hijack a tanker and turn it into a floating weapon prompted the three countries to launch trilateral patrols in July, a move the Indonesian navy said had reduced piracy attacks in the area.

Data from the International Maritime Bureau's Piracy Reporting Centre in Kuala Lumpur showed that Indonesian waters remained the world's most pirate-infested in the first three months of this year, accounting for 21 of the 79 attacks worldwide.

Smugglers also operate in the waters between the neighbouring countries.

The exercise, including mine-clearing exercises, ends Friday.